Use the Following Information to Answer the Next Two Questions

question 9

Multiple Choice

Use the following information to answer the next two questions:
A manufacturing firm is deciding whether to invest in a new printer that needs an initial investment of $150,000.This will increase cash flows in the first year by $80,000 and $75,000 in the second year.
-If the interest rate is 10% then the net present value of these cash flows is

• A)$5,000
• B)- $9,091
• C)-$15,290
• D)-$21,901

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Definitions:

Rationalization

The process of offering a logical or reasonable explanation for behaviors or decisions that might otherwise appear irrational.

Government Contract

A legally binding agreement between a business and a government entity for the supply of goods or services.

Best Interests

Actions or decisions that are considered most beneficial to the well-being or success of an individual or group.

Socially Responsible

Acting with consideration for the ethical, environmental, and community implications of one's actions, often linked to sustainable business practices.